With 2018 coming to an end, it’s time to set goals for 2019.
Everyone’s new year resolutions should include a few financial goals. Here are 3 financial goals which we recommend for 2019.
1. Clear Your Debts
Getting out of debt is another method to take control of your finances. By paying off your debts (eg. bank loans, credit cards, etc) you can reduce the amount of interest you can pay to the debtors. It is also a great feeling to be debt free, because you can stop paying interest and start earning interest. You may need to make a few sacrifices to make it happen, but it is worth the effort.
2. Save Your Money
There are many people who earn a lot of money but are still broke, because they aren’t able to keep what they earn.
Budgeting is the most important thing you can do to be financially successful. The key is to plan where you are going to spend your money, how much you want to save, and stick to it.
We recommend that you save at least 15% of your gross monthly income. The easiest way to do this is to set up your an automatic transfer from your checking account to your savings account for this amount every month. You can transfer the money back if you need it to pay bills, but always challenge yourself to live off what’s left after your automatic transfer.
3. Start Investing
The next step after saving money is investment. Investment is necessary because a normal bank account earns less than 1% interest, while inflation is 2-3%. This means that the money in your bank account is losing 1-2% of it’s value every year. Your investment goal should be to beat inflation and grow your wealth.
Many people invest money successfully on their own, but if you’re just starting out, you can consider consulting with a financial planner.
An experienced financial planner will ask you questions about your life priorities and financial goals, and provide you suitable solutions. If you are hesitant to invest because of the current market conditions or do not understand how the markets work, take the time to talk to a financial planner. He will help you understand the risks and benefits of investing, and recommend investment solutions that match your risk tolerance.
